Edgars warns of price hikes and smuggling surge after 300% fabric duty increase by Mthuli Ncube

TAKUDZWA HILLARY CHIWANZA 

Victoria Falls Stock Exchange (VFEX)-listed clothing retailer Edgars Stores Limited has raised concern over the Government’s decision to raise customs duty on key imported fabrics, warning that the policy will drive up clothing prices, worsen smuggling, and ultimately harm the cotton-to-clothing value chain.

Edgars group CEO, Sevious Mushosho

Presenting the 2026 National Budget in Harare last week, Finance, Economic Development and Investment Promotion Minister Professor Mthuli Ncube announced a 300 percent duty increase on selected imported polyester staple fibres and dyed woven cotton fabrics. 

The move, he said, is designed to bolster local production and strengthen linkages within the cotton-to-clothing value chain. 

He also proposed reviewing materials that qualify for the clothing manufacturers’ rebate—potentially excluding the affected fabrics—subject to local producers' ability to provide competitive quality and pricing. 

The new measures take effect on January 1, 2026.

But stakeholders in the cotton-to-clothing value chain, such as Edgars, are saying the Government should delay the tariff hike until an ongoing industry study is completed. 

The Competition and Tariff Commission (CTC) and the National Competitiveness Commission (NCC), commissioned by the Ministry of Industry and Commerce, are currently assessing production capacities and constraints across the value chain.

Speaking to ZimSphere, Edgars group chief executive officer Mr. Sevious Mushosho said the increased duty will weaken rather than strengthen the industry, arguing that local fabric manufacturers cannot meet the diverse and evolving needs of the fashion sector.

"As Edgars Stores Limited, the biggest manufacturer of clothing in the country through our Carousel Factory, we are of the view that this development will not benefit the cotton to clothing industry but will result in high prices for clothing and promotion of smuggling of both fabrics and finished garments," Mushosho said.

He added that domestic fabric producers currently offer only a limited range of materials.

"We are already buying what they are producing and augmenting with imports to meet our customers’ ever-changing fashion needs.

"The quality of local fabrics is not yet matching international standards and are more expensive. The millions they say they can produce are for the narrow range which makes no difference to the clothing manufacturers."

Mushosho also expressed concern that the tariff decision was announced before the ongoing CTC and NCC study is finalised, despite the study’s purpose being to recommend how best to revive the cotton-to-clothing value chain.

"Clothing manufacturing is the biggest player and employer in the cotton to clothing value chain. Such a move will have a significant negative impact on employment and growth in the sector as informal traders are the winners," he said.

He implored the Government to postpone implementing the duty increase until the value chain consultations are complete and the research findings can guide an informed policy position.